Certainly, the property market is still suffering. New apartment blocks and office buildings appear with few new occupiers to pay for them. The Burj Khalifa, the world’s tallest building—formerly known as Burj Dubai but renamed in honour of Sheikh Khalifa, Abu Dhabi’s ruler, after the bail-out—is reported to be largely empty.

But the real economy is not doing badly. Tourists are returning. Trade is apparently growing, particularly with India and China, although sanctions have made it trickier to export to Iran. The expatriate executives who manage most of the private sector are defensive about Dubai. They focus on the positives: thinning traffic jams, lower rents. Local media provide a stream of good news. So what’s the worry?

Debt of course! Turns out we still don’t know how much is owed by the city-state, its transparency aversion remains.

Good to hear the ‘real economy‘ is recovering. I suppose things come down to how the Dubai – Abu Dhabi politics play out and here The Economist is probable more clueless than most (“Abu Dhabi was willing to help when crisis hit, but it is tightening its purse-strings and some of its own property companies are struggling“).
It is right on the longer-term implications though:

Dubai’s longer-term worry will be how to keep this edge in the face of rising competition from its neighbours, which are trying to build their way out of boringness. Abu Dhabi has its Guggenheim, Qatar new museums by I.M. Pei and Jean Nouvel (seearticle), not to mention the 2022 football World Cup.

Lost in all the Schadenfreude is how having the three of these dynamic cities jostling for leadership in the region is an absolute positive for the Middle East regardless who comes out on top.

Sultan Bin Sulayem I imagine will be one of the main losers when we get through this episode. DP World, Nakheel, Istithmar, Limitless are so loaded up on debt and so exposed to an imploding local property market (a bubble and oversupply both very much a consequence of Nakheel’s actions) that they alone probably threatened Dubai’s solvency. Unfortunately this all coincides with a global collapse in trade which will make life difficult for DP World – which is the Dubai World bedrock.